[UPDATE] Amcorp Global to divest commercial podium at 183 Longhaus for $38 mil

/ EdgeProp Singapore |
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SINGAPORE (EDGEPROP) - Since its completion in July 2019, the 10 strata commercial units at mixed-use development 183 Longhaus have been gradually filling up. One of the first F&B tenants to move in was Woodlands Sourdough Bakery, which relocated from Serene Centre. “On both weekdays and weekends, we can see queues forming outside,” says Lawrence Toh, COO, Amcorp Global (formerly known as Tee Land, the developer of the project).
Last year, SOD Café opened its second branch at 183 Longhaus, in addition to its flagship at Ci Yuan Community Centre in Hougang. The café is famous for its bubble tea, Bak Kwa Fries and Chicken Supreme. The latest F&B tenant to open there is State of Affairs coffee bar. With operating hours from 6am, it caters to cyclists who want takeaway coffee.
Opening soon is Changi Nasi Lemak, which was founded over 20 years ago and has an outlet at Bukit Batok Street 33. The corner unit will see the opening of a restaurant with a beef bowl concept. Renovations are currently underway.
SOD Café opened last year, and this is its second branch, with its flagship at Ci Yuan Community Centre in Hougang (Photo: Samuel Isaac Chua/EdgeProp Singapore)

Positioning the asset

While the five freehold commercial units on the first level are for F&B use, the remaining five freehold commercial units on the basement level are for retail use. Occupying two units on the basement level is a fitness studio operated by F45 Training. Adjacent to it is BodyLove Pilates studio. “The basement is positioned for fitness and sports,” adds Toh. Amcorp Global is in talks with fitness and sports operators for the two remaining basement units.
According to Toh, tenants like F45 and Woodlands Sourdough have been at 183 Longhaus from the start when the development was first completed. F45 has renewed its lease for another three years until 2025, while Woodlands Sourdough has renewed its lease for another two years from October 2021. Most of the tenants’ leases are for two to three years.
F45 has a regular crowd, notes Toh. “On weekday evenings, I see a lot of young people going there after work,” he adds. In the basement, there is a carpark that is big enough for 10 cars. Two escalators serve the basement level.
F45 Training fitness centre - EDGEPROP SINGAPORE
F45 Training fitness centre has taken up two units in the basement, and is one of the first tenants at 183 Longhaus (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Despite Covid, eight out of the 10 strata commercial units at 183 Longhaus are now leased. Monthly average rental rates achieved so far are at about $7 psf for the basement level, and “high single digits” for the first level.
“It’s reassuring that despite the challenging Covid period over the last two years, 183 Longhaus was still able to secure 80% tenancy,” comments Low Choon Sin, managing partner of SRI Capital Markets. “It’s a testament to its good location for F&B and retail.”
Amcorp Global is now looking to divest the asset, and has engaged SRI as its sole marketing agency. The 10 commercial units at the commercial podium have a total strata area of 11,291 sq ft. The units will be sold as a portfolio, with a guide price of $38 million ($3,366 psf). It will be launched for sale by expression of interest on March 16, which will close on April 25. (Find Singapore commercial properties with our commercial directory)
The BodyLove (BoLo) Pilates Studio - EDGEPROP SINGAPORE
The BodyLove (BoLo) Pilates Studio in the basement of 183 Longhaus is located next to F45 Training fitness centre (Photo: Samuel Isaac Chua/EdgeProp Singapore)
“Since there are only 10 units, we believe it’s better for the commercial podium to be owned by a single landlord rather than have a fragmented ownership with many individual unit landlords,” says Toh. “With a single owner, the asset can be better positioned to achieve the desired tenant mix and it will prove to be more attractive and vibrant over the long term.”

Long-term investment

The retail podium has a share value of 27.9%, which means in the future, should the property be put up for collective sale, the owner will have a controlling vote, notes SRI’s Low. “There’s a fair amount of liquidity in the market, and we see high-net-worth investors seeking bulk ownership in a single development,” says Low. “The commercial podium at 183 Longhaus, which is already sub-divided into 10 units, provides the future owner with flexibility when it comes to divesting in the future.”
Across the road, two adjoining shophouses at 244D and 244E Upper Thomson Road changed hands for $5.88 million in May 2021, according to a caveat lodged with URA. Several units on the first level of Thomson Plaza changed hands recently, with prices going from $1.4 million ($3,941 psf) for a 355 sq ft unit, to $2.189 million ($5,649 psf) for a 388 sq ft unit. However, Thomson Plaza has a 99-year lease from 1976.
Toh: With a single owner, the asset will have a better tenant mix and will prove to be a more attractive and vibrant over the long-term (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Located along Upper Thomson Road, 183 Longhaus is a redevelopment of the former Longhouse Food Centre, which Tee Land purchased in January 2014 for $45.2 million.
The Upper Thomson area is undergoing renewal. Across the road from 183 Longhaus is the Thomson Community Club, which is being redeveloped into a new 64,584 sq ft complex with facilities such as a covered basketball court, culinary studio and larger dance studios. The new community club will also be linked to the Shunfu Market.
Nearby, the Upper Thomson MRT Station on the Thomson-East Coast Line opened last August. The 1,206-unit private condo, Jade-Scape (formerly Shunfu Ville), is fully sold and scheduled for completion sometime this year. “When it’s completed, it will really transform the neighbourhood,” notes Toh. (Discover insightful data of any Singapore condominium with our condo directory)
Artist’s impression of the 1,206-unit JadeScape - EDGEPROP SINGAPORE
Artist’s impression of the 1,206-unit JadeScape by Qingjian Realty at Shunfu Road, which is expected to be completed sometime in 2H2022 (Credit: Qingjian Realty)
Nearby, Thomson View, another privatised HUDC estate, made a collective sale attempt last November, at a guide price of $950 million.
Sitting on top of the retail podium at 183 Longhaus are 40 freehold residential units that span the second to fourth floors. Since its launch in February 2016, all the units have been sold at an average price at $1,579 psf, based on caveats lodged. Toh sees 183 Longhaus as a “long-term asset” for a potential buyer banking on future upside from rejuvenation of the neighbourhood.

Takeover of Tee Land

The sale of the commercial units at 183 Longhaus is part of Amcorp Global’s current focus on divestments and selling remaining inventory to strengthen its financial position for future opportunities, says Toh.
Thomson View was put up for collective sale last November at a price tag of $950 million (Photo: The Edge Singapore)
It was in February 2020 that Malaysia’s Amcorp Group assumed control of Tee Land. This was after it made an offer of 17.9 cents a share to buy over the remaining 31.22% of Tee Land which it did not already own. The offer came three weeks after the announcement that Amcorp would buy over a combined 68.78% stake in Tee Land from its parent Tee International and from Phua Chian Kin, Tee International’s CEO and controlling shareholder, for just over $55 million.
Amcorp Global is seeking to complete and sell the remaining inventory in its portfolio. For instance, it intends to complete the construction of Lattice One, its 48-unit freehold residential development at Seraya Crescent, by 4Q2022. The project is fully sold at an average price of $1,788 psf.
The developer is also targeting to complete its 70-unit, freehold residential project 35 Gilstead by 2H2023. To date, the project is over 60% sold at an average price of $2,520 psf. The project on Gilstead Road is located in prime District 11. “We are pricing the units to sell,” says Toh.
Hexacube, where Amcorp Global holds a 30% stake in the 70-unit commercial development jointly with Lian Beng Group and KSH Holdings (Photo: Savills/CBRE)

Other assets

Besides the commercial podium at 183 Longhaus, Amcorp Global has stakes in two other freehold commercial developments, namely, Hexacube at 160 Changi Road and Trio at 11 Sam Leong Road.
At Hexacube, Amcorp Global has a 30% stake in the special purpose vehicle (SPV) that owns the 73-unit freehold commercial development. The other joint-venture partners are Singapore-listed SLB Development and KSH Holdings. In September 2020, the SPV put up for sale the remaining 22 unsold F&B and retail units by expression of interest. The guide price of the portfolio was $43.8 million ($3,252 psf). It was jointly marketed by CBRE and Savills Singapore.
Amcorp Global also has a 35% stake in the SPV that owns the 43-unit commercial development Trio. To date, 19 retail units and six F&B units remain unsold, bringing the tally to 25 units. Of these, 24 have been leased. The other partners in the SPV include Heeton Holdings, KSH Holdings, Futuris and ZAP Piling. The development is positioned as a mall within Little India.
mixed-use project at 183 Longhaus - EDGEPROP SINGAPORE
The mixed-use project at 183 Longhaus (redevelopment of the former Longhouse Food Centre) with 40 residential units and a commercial podium with 10 units that is offered for bulk sale (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Whether the SPV would be looking to put these properties on the market will depend on market demand, says Toh. “Post-cooling measures and the recent hike in residential property tax have channelled some investor interest to non-residential assets,” he adds.
In Malaysia, Amcorp Global owns a 100% stake in a 17-storey, freehold office building in Cyberjaya, Selangor. The office building is part of the mixed-use development Third Avenue, which includes 701 residential units and 31 retail shops. Besides the office building, there are two restaurant units, one retail unit and seven residential units that remain unsold.
According to Toh, Amcorp Global is looking for a potential buyer for the office building, which has remained vacant since its completion in 2018.
Low: There’s a fair amount of liquidity in the market, and we see high net worth investors seeking bulk ownership in a single development (Photo: Samuel Isaac Chua/EdgeProp Singapore)
Other assets in Amcorp Global’s portfolio include three residential units in a condominium development in Bangkok and the 103-key Larmont Hotel Sydney in New South Wales, Australia, says Toh.
For now, the focus is on the sale of its commercial podium at 183 Longhaus. According to SRI’s Low, its location is attractive, given that it is in the vicinity of an established private housing estate in a relatively affluent neighbourhood.

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